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2018-07-01 19:36:06

DVMT

Dell Technologies

$84.59

-0.66 (-0.77%)

, VMW

VMware

$146.97

0.78 (0.53%)

…19:36

07/01/18

07/01

19:36

07/01/18

19:36

On The Fly: Top five weekend stock stories

Catch up on the weekend's top five stories with this list compiled by The Fly: 1. Dell (DVMT) is near a deal to combine shares that track its VMware (VMW) virtualization-software unit in an effort that would result in a public listing for the personal computer and data storage company, according to The Wall Street Journal. 2. Tesla (TSLA) nearly produced 5,000 Model 3 vehicles in the last week of its second quarter, with the final car rolling off the assembly line on Sunday morning, several hours after the midnight goal set by CEO Elon Musk, according to Reuters, citing two workers at the factory. 3. Drugstore stocks plunged on the news that Amazon (AMZN) is buying mail-order pharmacy PillPack, Bill Alpert wrote in this week's edition of Barron's. By week's end, shares of Walgreens Boots Alliance (WBA), CVS Health (CVS), Rite Aid (RAD), Fred's (FRED), Cardinal Health (CAH), AmerisourceBergen (ABC), and McKesson (MCK) were all in negative territory as investors "probably overreacted," he contended. "No one should doubt the ability of Amazon to disrupt an industry," but Wall Street has greatly reduced the multiples that it pays for drug chains and chances are, drugstore stocks will recover from that "anxiety attack," Alpert added. 4. Universal (CMCSA; CMCSK) and Amblin's "Jurassic World: Fallen Kingdom" won the box office again in its second weekend, with $60M in North America as it nears the $1B mark globally. Overseas, the movie grossed another $56.1M from 68 markets for a foreign tally of $667.6M and a global haul of $932.4M. "Jurassic World: Fallen Kingdom" earned an A- and sports a 50% Rotten Tomatoes. 5. Electronic Arts (EA), Equity Commonwealth (EQC), Graco (GGG), MasterCard (MA), and Verizon (VZ) saw positive mentions in Barron's, while Harley-Davidson (HOG) was mentioned cautiously.

Hilliard Lyons analyst Stephen Turner downgraded VMware (VMW) to Neutral while raising his price target for the shares to $150 from $145. The analyst views the company's Q4 results as "strong," but believes the potential of a reverse merger with Dell will hang over the stock.

03/02/18

03/02/18DOWNGRADE

On The Fly: Top five analyst downgrades

Catch up on today's top five analyst downgrades with this list compiled by The Fly: 1. Walmart (WMT) downgraded to Perform from Outperform at Oppenheimer by analysts Rupesh Parikh and Brian Nagel, who said that while they remain "upbeat" on the retailer's strategic direction, they no longer see the case for Walmart outperformance and are "increasingly concerned" that the valuation at which shares trade could prove capped. 2. VMware (VMW) downgraded to Hold from Buy at Stifel by analyst Brad Reback, who sees "too much uncertainty" as parent Dell Technologies (DVMT) evaluates "potential business opportunities." He believes, however, that VMware continues to execute well following its "strong" Q4 results. 3. Ruth's Hospitality (RUTH) downgraded to Hold from Buy at Deutsche Bank by analyst Brett Levy, who said the company's progress and upside are largely priced in given the company's premium multiple, Levy tells investors in a research note. The analyst this morning also upgraded both Bloomin' Brands (BLMN) and Del Frisco's (DFRG) to Buy. 4. Opko Health (OPK) downgraded to Underweight from Neutral at JPMorgan by analyst Eric Joseph, who believes the company's Q4 miss raises "significant doubts" for the core diagnostics/ BRL business. He believes the stock will continue to see pressure going forward. 5. Pure Storage (PSTG) downgraded to Neutral from Positive at Susquehanna by analyst Mehdi Hosseini, who cited the lack of visibility, particularly around FlashBlade, to raise estimates from current levels, which would be necessary for the next leg of appreciation. This list is just a portion of The Fly's full analyst coverage. To see The Fly's full Street Research coverage, click here.

Deutsche Bank analyst Karl Keirstead believes Friday's initial public offering filing by Pivotal Software is a "modest positive" for shareholders of Dell Technologies (DVMT) and VMware (VMW). The filing reduces, but does not eliminate, the likelihood that Dell pursues actions "more punitive" to VMware and Dell Technologies holders, namely a reverse merger with VMware, Keirstead tells investors in a research note.

Deutsche Bank analyst Karl Keirstead raised his price target for Dell Technologies to $120 saying the company's yesterday posted "another solid print" that showed signs of improvement, not deterioration. The results "further undermine the lingering narrative that Dell is so troubled that it must find a way to access VMware's cash," Keirstead tells investors in a research note. He keeps a Buy rating on Dell Technologies.

VMWVMware

$146.97

0.78 (0.53%)

06/01/18

MSCO

06/01/18NO CHANGETarget $150MSCOOverweight

VMware price target raised to $150 from $143 at Morgan Stanley

Morgan Stanley analyst Keith Weiss said VMware's acceleration in license billings growth in Q1 "clearly shows" the company's fundamental performance hasn't been impacted by Dell's strategic review, though he recognizes the Dell risk may remain an impediment to fundamentals being fully reflected in VMware shares. Weiss raised his price target on VMware shares to $150 following what he called the "solid start" to FY19, but noted that absent the Dell overhang he believes the stock could trade closer to $170 if it was assigned a multiple more in-line with the group average.

06/01/18

FBCO

06/01/18NO CHANGETarget $160FBCOOutperform

VMware price target raised to $160 from $155 at Credit Suisse

Credit Suisse analyst Brad Zelnick raised his price target for VMware to $160 from $155 and reiterated an Outperform rating on the shares following the company's "exceptional" Q1 results. While the company did not provide an update on Dell's 13D filing, Zelnick said VMware remains one of the few software stocks trading at a deep discount to intrinsic value.

06/01/18

RBCM

06/01/18NO CHANGETarget $160RBCMOutperform

VMware price target raised to $160 from $150 at RBC Capital

RBC Capital analyst Matthew Hedberg raised his price target for VMware to $160 from $150 and maintained an Outperform rating on shares after the company delivered a "strong" start to the year, highlighted by license billings and license revenue, which both grew 21% year over year. In a research note to investors, Hedberg said he believes VMware is well positioned for growth in non-vSphere including NSX, vSAN, VxRail and End User Computing, which he says are all "moving the needle." He also sees the potential for $1B in revenue synergies through Dell, and that while some investors may shy away from VMware given the Dell ownership, he thinks that it "remains in Dell's best interest to let this disruptive and well positioned asset thrive."

Bernstein analyst Toni Sacconaghi, Jr. noted that Tesla's "Services and Other" gross margins have steeply plunged in recent quarters and he struggles to find evidence as to why. Offering some hypotheses as to what could be occurring, but stating they are largely "guesses," the analyst said that if "Services and Other" is being burdened somehow with costs that ought to be in the Automotive segment, then Tesla's Automotive segment gross margins, which get much more investor attention, may be overstated. To conclude, Sacconaghi noted he is "not questioning Tesla's overall reported gross margins but rather the reported split between Automotive vs. Services & Other." He maintains a Market Perform rating and $265 price target on Tesla shares.

06/26/18

GSCO

06/26/18NO CHANGETarget $195GSCOSell

Tesla Model 3 deliveries in Q2 may disappoint, says Goldman Sachs

Goldman Sachs analyst David Tamberrino expects Tesla to announce its Q2 deliveries shortly after the quarter ends, likely around July 3. He believes the company is tracking below its 2018 Model S/X guidance of 100,000 units, projecting combined S and X deliveries of 23,000, though this would top the current consensus forecast of 22,300, according to FactSet. However, Tamberrino also believes that Model 3 deliveries are tracking below consensus. Tamberrino maintains a Sell rating and $195 price target on Tesla shares.

Vertical Group analyst Gordon Johnson estimates a 66% cancellation rate for the day one Tesla Model 3 reservations of 140,000. When applying the figure to his estimate for 582,000 in gross reservations through mid-April, the analyst calculates sales in early Model 3 reservations of just 197,000. Either Model 3 cancellation rates have spiked from the "initial euphoria period" of March 31, 2016 to April 30, 2016, or new reservations have "virtually disappeared," Johnson tells investors in a research note. He believes Tesla will exhaust all pre-orders sometime in Q1 of 2019. Model 3 sales beyond Q1 of next year will be limited by demand versus supply while growth for Tesla will likely depend on new product introductions, the analyst contends. Johnson thinks investors, as a result, will be forced to question Tesla's "valuation as a growth stock imminently." He does, however, expect CEO Elon Musk "to use a lot of one-time items to try to achieve profitability" in Q3 and Q4 of 2018. Profitability will rest largely on Tesla's ability to sell a record number of zero emission vehicle credits, which may prove difficult, Johnson predicts. He keeps a Sell rating on shares of Tesla with a $93 price target. The stock closed yesterday up $2.01 to $344.78.

Baird analyst Ben Kallo expects Tesla Q2 delivery numbers to be released by July 3 and he said he would be a buyer heading into the release. He believes the stock will trade up if the Model 3 approaches the 5K/week production target. More importantly, he believes there will be a larger number of vehicles in the channel compared to previous quarters given the back-ended ramp during Q2. Kallo reiterated his Outperform rating, Fresh Pick designation, and $411 price target on Tesla shares.

AMZNAmazon.com

$1,700.22

-1.42 (-0.08%)

06/29/18

RBCM

06/29/18NO CHANGETarget $158RBCMSector Perform

McKesson price target lowered to $158 from $170 at RBC Capital

RBC Capital analyst George Hill lowered his price target on McKesson (MCK) to $158 and kept his Sector Perform rating, saying he is reducing his target multiple by one turn as a result of Amazon's (AMZN) entry into the pharmacy space. Hilll notes that the Amazon announcement overshadowed McKesson's investor day, where the company highlighted its "sustainable" organic growth expectations and affirmed its guidance.

06/29/18

RBCM

06/29/18NO CHANGETarget $84RBCMOutperform

CVS Health price target lowered to $84 from $91 at RBC Capital

RBC Capital analyst George Hill lowered his price target on CVS Health Corp (CVS) to $84 after Amazon (AMZN) announced its entry into the pharmacy space with the acquisition of PillPack, even though he believes that the "stickiness of payer/pharmacy relationships, decreasing share of mail order, and PillPack's market share" will not cut margins in near to medium term. Hill keeps his Outperform rating on CVS, noting that it is better positioned to continue to grow its EBIT than Walgreens (WBA). The analyst also sees Amazon's entry into drug distribution raising the possibility of DOJ approval of CVS's Aetna (AET) acquisition.

06/29/18

MSCO

06/29/18NO CHANGEMSCO

Amazon to insource growing part of own volume over time, says Morgan Stanley

After Amazon (AMZN) announced yesterday that it is inviting entrepreneurs to form small delivery companies, Morgan Stanley analyst Brian Nowak called it the company's most overt and public move yet in relation to building out its in-house logistics network. Nowak remains cautious on the parcel companies overall and keeps an Underweight rating on UPS (UPS) and an Equal Weight rating on FedEx (FDX), stating that he expects Amazon to insource a growing percentage of its own volumes over time. In the "best case scenario," UPS and FedEx will not grow with Amazon in e-commerce, which could be a significant drag, while in a "worst case scenario" Amazon becomes a full-fledged competitor, Nowak added.

RBC Capital analyst George Hill lowered his price target on Walgreens (WBA) to $68 after its "mixed" quarter, with operating profit missing expectations even though earnings registered a slight beat from lower tax rates. Hill keeps his Outperform rating however, saying the sharp decline in the stock price after Amazon's (AMZN) announced entry into the pharmacy business is an "overreaction". The analyst also believes that the company's $10B stock repurchase is a sign that acquisitions are less likely in the near term.

Loop Capital analyst Andrew Wolf lowered his price target on Walgreens Boots Alliance (WBA) to $80, saying that while the company beat on Q3 earnings and raised the low end of its FY18 guidance, its comps and EBIT were lower than expected. Wolf notes that the management is not concerned with Amazon's (AMZN) competitive threat through its PillPack purchase, adding that while it will initially go after the mail order franchises, longer term it may target retail firms through distribution of "acute prescriptions". The analyst keeps his Buy rating on Walgreens Boots Alliance.

06/29/18

JEFF

06/29/18DOWNGRADETarget $65JEFFHold

Walgreens Boots Alliance downgraded to Hold from Buy at Jefferies

Jefferies analyst Brian Tanquilut downgraded Walgreens Boots Alliance (WBA) to Hold and lowered his price target for the shares to $65 from $85. The stock closed yesterday down 10%, or $6.56, to $59.70. Amazon's (AMZN) acquisition of mail order pharmacy PillPack has "enlarged the overhang" on the retail pharmacy space, Tanquilut tells investors in a research note. The analyst believes the deal could prevent both Walgreens and CVS Health (CVS) from seeing meaningful stock upside near-term. Further, Walgreens' Q3 results, which saw "weak" same-store-sales trends, do not help diffuse the perceived risk that Amazon brings to the company, Tanquilut argues.

JPMorgan Analyst Lisa Gill said Amazon's (AMZN) agreement to acquire PillPack is expected to drive a "significant overhang" on sentiment across the prescription channel, even though she doesn't expect PillPack to capture a material share of the market in the near term. While the deal establishes an initial foothold for Amazon in the mail pharmacy space, she thinks it will take time to scale up and she does not believe PillPack's unit dose packaging technology is unique. Gill also noted that Express Scripts (ESRX) said it would remove PillPack from its pharmacy network in 2016 on allegations it had misrepresented itself as a retail pharmacy and not a mail pharmacy, though within weeks PillPack was added back by the PBM. Shares of retail pharmacy operators CVS Health (CVS), Walgreens (WBA) and Rite Aid (RAD) have all been pressured by the news of Amazon's deal, as have the shares of drug distributors AmerisourceBergen (ABC), Cardinal Health (CAH) and McKesson (MCK). Diplomat Pharmacy (DPLO), an operator of a specialty pharmacy, is also sharply lower following the announcement from Amazon.

06/29/18

MZHO

06/29/18NO CHANGEMZHO

CVS, Express Scripts should be bought on recent selloff, says Mizuho

Mizuho analyst Ann Hynes recommends buying shares of CVS Health (CVS) and Express Scripts (ESRX) on weakness related to the announcement Amazon (AMZN) is entering the pharmacy space with its acquisition of PillPack. PillPack is a small mail order pharmacy, similar to the mail order pharmacies embedded in CVS Caremark, Express Scripts and OptumRx, Hynes tells investors in a research note.

After CNBC reported yesterday afternoon that Amazon (AMZN) has decided to shelve its plan to sell and distribute pharmaceutical products, Mizuho analyst Ann Hynes said she had thought Amazon's current logistics and distribution model would not translate into healthcare. However, based on conversations with investors, she believes the magnitude of the overhang that Amazon presented for drug distributors and retail pharmacies was "unprecedented." While drug pricing is still a concern, she notes that the CNBC report removes one overhang on the drug supply chain stocks. Hynes remain a buyer of CVS Health (CVS) and Walgreens (WBA) and keeps Neutral ratings on Rite Aid (RAD) as well as on drug distributors AmerisourceBergen (ABC), Cardinal Health (CAH) and McKesson (MCK).

04/30/18

LOOP

04/30/18NO CHANGETarget $4LOOPHold

Fred's CEO resignation 'fire but no sale,' says Loop Capital

In a research note titled "CEO resigns - Fire but no sale," Loop Capital analyst Andrew Wolf notes that Fred's (FRED) has announced the resignation of Chief Executive Officer Michael Bloom, effective as of April 24, 2018. Joseph Anto, Fred's Executive Vice President and Chief Financial Officer, will serve as Interim Chief Executive Officer. Additionally, the analyst points out that Alden Capital owns 24% of Fred's shares and its President, Heath Freeman, is now Chairman of the Board of Fred's. According to Freeman in a press release, "After the Company was not able to purchase certain assets from the Rite Aid Corporation (RAD)...the timing was right, both for Mike [Bloom] and the Company, for him to step down." Wolf reiterates a Hold rating and $4 price target on Fred's shares.

Baird analyst Colin Sebastian believes Amazon.com's (AMZN) acquisition of PillPack creates a formidable competitor to brick-and-mortar pharmacy peers. Shares of CVS Health (CVS), Walgreens Boots Alliance (WBA) and Rite Aid (RAD) are trading lower following the news. PillPack provides a full-service online pharmacy experience and delivers medication in pre-sorted dose packaging for customers across the U.S., Sebastian tells investors in a research note. The deal creates another competitive advantage over competing e-commerce platforms as Amazon seeks to integrate its pharmacy business with other verticals with high purchase frequency like grocery, the analyst adds. Amazon this morning also announced the expansion of Delivery Partners, a service enabling individuals to build small parcel delivery businesses in support of Amazon's e-commerce growth. Sebastian thinks the delivery service partner initiative represents an important step in last-mile delivery, particularly as customer demand for two-hour delivery increases with the increasing adoption of Prime Now. The analyst has an Outperform rating on Amazon.com with a $1,800 price target.

FREDFred's

$2.28

0.22 (10.68%)

08/25/17

08/25/17INITIATION

On The Fly: Top five analyst initiations

Catch up on today's top five analyst initiations with this list compiled by The Fly: 1. Walgreens Boots Alliance (WBA) initiated with a Buy and CVS Health (CVS) and Fred's (FRED) initiated with a Hold at Loop Capital. 2. Adobe (ADBE), Intuit (INTU), GoDaddy (GDDY) initiated with a Buy at Jefferies, while Mindbody (MB) was initiated with a Hold. 3. New Oriental Education (EDU), Bright Scholar (BEDU) and TAL Education (TAL) initiated with Overweight ratings at Morgan Stanley. 4. WellCare (WCG) coverage assumed with an Overweight at Cantor. 5. Dollar Tree (DLTR) and Dollar General (DG) reinstated with Buy ratings at BofA/Merrill. This list is just a portion of The Fly's full analyst coverage. To see The Fly's full Street Research coverage, click here.

12/07/17

LOOP

12/07/17NO CHANGETarget $4LOOPHold

Fred's price target lowered to $4 from $6 at Loop Capital

Loop Capital analyst Andrew Wolf lowered his price target on Fred's to $4 after a Q3 earnings miss, lower than expected sales, disappointing comps, and a 141bps gross margin contraction. Wolf cites inventory adjustments and competitive price pressures behind the disappointing results but adds that customer traffic has recently turned around. The analyst keeps his Hold rating on Fred's, saying his new price target already discounts the early stage turnaround that he anticipates for 2018.

06/18/18

LOOP

06/18/18NO CHANGETarget $2LOOPHold

Fred's price target lowered to $2 from $4 at Loop Capital

Loop Capital analyst Andrew Wolf lowered his price target on Fred's after its Q1 results, saying there is "no real sign of a turnaround" despite the management claims of progress in cost cutting. The analyst also points to the company's interest in selling its prescription pharmacy files and certain real estate assets, modeling its value at $1.25-$2.25 per share for stockholders on liquidation basis. Wolf keeps his Hold rating on Fred's, adding there are many unknowns around the value of "Fred's prescription files and real estate holdings, as well as the company's potential lower-than-market leases."

CAHCardinal Health

$48.83

-1.0737 (-2.15%)

05/07/18

MZHO

05/07/18NO CHANGETarget $61MZHONeutral

Cardinal Health price target lowered to $61 from $73 at Mizuho

Mizuho analyst Ann Hynes lowered her price target for Cardinal Health to $61 citing the company's "soft" outlook. Cardinal's reduced guidance highlights the company's lack of earnings visibility and challenges it faces with Cordis, Hynes tells investors in a research note. She keeps a Neutral rating on the shares.

05/04/18

LEER

05/04/18NO CHANGETarget $65LEEROutperform

Cardinal Health FY19 guidance a 'clearing event,' says Leerink

Leerink analyst David Larsen believes that while Cardinal Health's Q3 results were disappointing, the quarter and the FY19 guidance were "a clearing event" for the stock. The Medical segment ex-Cordis appears to be performing well and the core Pharma business had another quarter of strong performance, said Larsen, who keeps an Outperform rating on Cardinal Health but lowered his price target on the stock to $65 from $75.

05/04/18

RBCM

05/04/18NO CHANGETarget $62RBCMSector Perform

Cardinal Health price target lowered to $62 from $81 at RBC Capital

RBC Capital analyst George Hill lowered his price target on Cardinal Health to $62 and kept his Sector Perform rating after its Q3 earnings miss as a result of an inventory write-down in its Cordis business along with a related tax expense. The analyst also attributes his increased pessimism to the management's discussion of "the loss of PharMerica and a higher-than-normal number of customer repricing arrangements".

Goldman Sachs analyst Robert Jones keeps his Buy rating and $111 price target on AmerisourceBergen after hosting investor meetings with the company's top management. Jones writes that the recent stock price pullback of 8% since the start of the week is attributed to concerns regarding the scope of the drug pricing proposals from the White House, noting that many of the changes will still require Congressional approval and will likely face implementation challenges. As such, the analyst believes that the stock price decline is "overdone". Jones adds that the management's views on AmerisourceBergen's core business are even more positive than expected, with "potential for improvement in generic pricing and sustainable strength in the specialty business".

Leerink analyst Ana Gupte sees the possible Humana (HUM)-Walmart (WMT) deal as transformational for the U.S. Seniors market and estimates the deal value at close to $50B. The analyst also believes the deal helps Humana compete more effectively with UnitedHealth (UNH)/Optum and Aetna (AET)-CVS (CVS), while Walmart can also compete with Amazon (AMZN) that is eroding sales and likely eyeing an entry into the Prescription Rx market. Gupte expects the anti-trust scrutiny of three deals Aetna-CVS, Cigna (CI)-Express Scripts (ESRX) and Humana-Walmart by the DOJ will be more challenged under simultaneous review by the DOJ, though Walmart and Humana have the least anti-competitive issues. Humana-Walmart could catalyze a counter-offer for Cigna from Walgreens Boots Alliance (WBA) or even Amazon, or re-invigorate Walgreens-AmerisourceBergen (ABC) talks, she contends.

MCKMcKesson

$133.43

-2.38 (-1.75%)

05/29/18

LEER

05/29/18NO CHANGETarget $160LEERMarket Perform

McKesson price target lowered to $160 from $170 at Leerink

Leerink analyst David Larsen lowered his price target for McKesson to $160 from $170 saying he is slightly more cautious on the company and the drug distribution group following its earnings report and call. Continued commentary of stabilizing drug pricing trends bodes well for the group, but the analyst is still worry about renewals, generic pricing pressure, and a slowdown in list price inflation. Larsen reiterates a Market Perform rating on the shares.

CMCSAComcast

$32.79

0.15 (0.46%)

06/27/18

GUGG

06/27/18NO CHANGETarget $82GUGGBuy

WWE price target raised to $82 from $68 at Guggenheim

After WWE announced new five year deals for RAW and SmackDown yesterday evening, Guggenheim analyst Curry Baker raised his price target on the stock to $82 from $68, noting that the combined average annual value of the deals with Comcast's (CMCSA) USA Network and Fox Sports (FOXA) of $524M was ahead of his $500M a year forecast. Beyond the renewals, Baker sees a number of opportunities remaining for WWE, including renewals in the UK and India, incremental content deals, and WWE Network tiering. He keeps a Buy rating on WWE shares.

Jefferies analyst John Janedis told investors in a research note that he has noted healthy ad demand this quarter, and combined with "decent" ratings at key cable networks like Bravo, USA and Oxygen, Comcast's (CMCSA) NBCUniversal appears to be performing well. Janedis, who has a Buy rating and $41 price target on Comcast shares, believes a potential Fox (FOXA) deal is "largely priced" into shares and that the stock will trade higher when the dust settles -- either way. Following Disney's (DIS) $38 per share offer for Fox assets, he thinks a competing offer from Comcast would need to be at least $42.50 per share to be viewed as superior, adding that Comcast likely has options for Fox that include more than a straight cash offer.

06/26/18

BUCK

06/26/18INITIATIONBUCKNeutral

Sky initiated with a Neutral at Buckingham

Earlier today, Buckingham analyst Michael Harrigan initiated Sky (SKYAY) with a Neutral rating and GBP14.50 price target with 3% upside, above Comcast's (CMCSA) GBP12.50 cash bid and a premium to 21st Century Fox's (FOXA) GBP10.75 bid to buy the 61% of Sky it does not already own. The analyst tells investors in a research note that a higher bid assessment could be triggered by the U.K. Takeover Panel exercising its authority to mandate a higher takeout bid if the price paid by Comcast or Disney (DIS) to buy the 21st Century Fox assets that are in play implies a higher bid.

06/20/18

KEYB

06/20/18NO CHANGEKEYB

KeyBanc sees end of Fox bidding war nearing, with Disney as likely winner

KeyBanc analyst Brandon Nispel does not think Comcast (CMCSA) can bid above $42 in all-cash offer for the assets of 21st Century Fox (FOXA) and maintain reasonable leverage ratios, adding that it may be able to go as high as $45 per share in a cash and stock offer. However, a $45 per share bid, split 80/20 cash and stock, would "hardly be accretive" in the next two years and be perceived negatively by Comcast shareholders, he contends. Given this view, Nispel argues the bidding war is approaching an end and he views Disney (DIS) as the likely winner.

CMCSKComcast

$0.00

(0.00%)

06/13/18

06/13/18DOWNGRADE

On The Fly: Top five analyst downgrades

Catch up on today's top five analyst downgrades with this list compiled by The Fly: 1. Square (SQ) downgraded to Neutral from Buy at Buckingham with analyst Chris Brendler saying he is taking a "breather" following the year-to-date share outperformance but raised his price target to $65 from $55. 2. Yelp (YELP) downgraded to Sell from Hold at Aegis. 3. AT&T (T) was downgraded to Sell from Neutral at MoffettNathanson while Time Warner (TWX) was downgraded to Neutral from Buy at the firm. Time Warner was also downgraded to Market Perform from Outperform at Barrington. 4. Comcast (CMCSA) downgraded to Market Perform from Outperform at Raymond James. 5. Advaxis (ADXS) downgraded to Hold from Buy at Jefferies. This list is just a portion of The Fly's full analyst coverage. To see The Fly's full Street Research coverage, click here.

Oppenheimer analyst Timothy Horan notes that Comcast (CMCSA) has bid $65B for a cash offer for Fox's (FOXA) entertainment assets, a 19% premium to Disney's offer (DIS). The analyst believes it does make strategic/financial sense, and Comcast has a great track record on acquisitions. Further, Horan thinks a joint NBC/Fox would be a content powerhouse while expanding the company's presence in Europe with Sky (SKYAY), and slashing OTT video risk. Nonetheless, the analyst believes Disney is likely to top the bid. He reiterates an Outperform rating and $42 price target on Comcast's shares.

EAElectronic Arts

$141.11

0.47 (0.33%)

06/25/18

PIPR

06/25/18NO CHANGEPIPROverweight

Video game revenue could be ~100% digital by 2022, says Piper Jaffray

Piper Jaffray analyst Michael Olson told investors in a research note that by 2022 there is a high likelihood that ~100% of video game revenue will be digital, adding that publisher margins could be dramatically higher if this is the case. Based on the implied share prices resulting from his 100% digital calendar year 2022 EPS scenario, Olson believes this would be a tailwind for Activision (ATVI), EA (EA) and Take-Two (TTWO) and that the average 3-yr share price CAGR for the video game group would be 17%. Olson maintained an Overweight rating on Activision, EA and Take-Two.

06/22/18

NEED

06/22/18NO CHANGETarget $170NEEDBuy

Electronic Arts price target raised to $170 from $135 at Needham

Needham analyst Laura Martin raised her price target on Electronic Arts to $170 and kept her Buy rating, citing the company's ongoing efforts in driving subscription revenues. Martin estimates those sales to reach about $240M in FY19 amid the prevailing trend among millenials to rent content rather than own it, adding that the model also reduces revenue volatility from game-makers' "hit" titles. The analyst also raised her FY19 EPS forecast to $5.00 from $4.85.

UBS analyst Eric Sheridan see the video game industry on the cusp of a transformation in its business model towards "Gaming-as-a-Service" along with streaming and subscriptions, which he views as supportive of sustainable revenue growth, margin expansion and more stable and predictable free cash flow. Though still in its early days as an industry, esports has exhibited "promising signs," added Sheridan, who raised his price target on Activision Blizzard (ATVI) to $88 from $76 and his target on Electronic Arts (EA) to $176 from $146. He maintains Buy ratings on both game maker's stocks.

06/20/18

PIPR

06/20/18NO CHANGEPIPR

May NPD video game software sales rose 15%, says Piper Jaffray

May NPD video game software sales were up 15% year-over-year, driven by Sony (SNE) and Nintendo (NTDOY) launches of first-party titles, Piper Jaffray analyst Michael Olson tells investors in a research note. The analyst views May NPD data as less relevant for publishers since there were no major launches from Activision Blizzard (ATVI), Electronic Arts (EA) or Take-Two (TTWO). He maintains Overweight ratings on all three names.

EQCEquity Commonwealth

$31.50

0.07 (0.22%)

02/16/18

STFL

02/16/18UPGRADETarget $32STFLBuy

Equity Commonwealth upgraded to Buy with $32 target at Stifel

Stifel analyst John Guinee upgraded Equity Commonwealth to Buy from Hold and raised his price target for the shares to $32 from $31. The analyst views the company as an "excellent defensive stock in a difficult REIT environment."

02/16/18

STFL

02/16/18UPGRADESTFLBuy

Equity Commonwealth upgraded to Buy from Hold at Stifel

GGGGraco

$45.22

0.22 (0.49%)

04/12/18

DADA

04/12/18INITIATIONTarget $48DADANeutral

Graco initiated with a Neutral at DA Davidson

DA Davidson analyst Matt Summerville initiated Graco with a Neutral rating and a price target of $48, citing the company's leverage to positive trends across its end markets that include construction, industrial, and automotive. Summerville also points to Graco's "best-in-class" profitability, history of strong returns, and free cash flow generation. The analyst sees shares as "appropriately valued" however, adding he does not anticipate any material upgrade in consensus earnings.

07/11/17

WOLF

07/11/17INITIATIONTarget $100WOLFUnderperform

Graco initiated with an Underperform at Wolfe Research

Wolfe Research initiated Graco with an Underperform and a $100 price target.

01/23/18

DBAB

01/23/18UPGRADETarget $55DBABBuy

Graco upgraded to Buy from Hold at Deutsche Bank

Deutsche Bank analyst Saree Boroditsky upgraded Graco to Buy and raised her price target for the shares to $55 from $45. The company is a "best-in-class industrial" that is well positioned to benefit from strength in the global industrial economy and an acceleration in capital investment, Boroditsky tells investors in a research note. The analyst notes her 2018 estimates are 18% above consensus after taking into account end market trends and tax reform.

07/31/17

WOLF

07/31/17UPGRADEWOLFPeer Perform

Graco upgraded to Peer Perform from Underperform at Wolfe Research

MAMasterCard

$196.80

-0.23 (-0.12%)

06/08/18

WEDB

06/08/18NO CHANGETarget $100WEDBOutperform

PayPal added to Best Ideas List at Wedbush at Wedbush

Wedbush analyst Moshe Katri added PayPal (PYPL) to the firm's Best Ideas List, citing a view that monetization efforts on both consumer and merchant-facing platforms, its partnerships with banks and Visa (V) and MasterCard (MA) and its post eBay (EBAY) separation opportunities could accelerate top-line growth and expand margins. Katri has an Outperform rating on PayPal and raised his price target on the shares to $100 from $90.

05/25/18

WEDB

05/25/18NO CHANGETarget $90WEDBOutperform

PayPal's Outperform rating backed at Wedbush following 'upbeat' investor day

Wedbush analyst Moshe Katri backed an Outperform rating and $90 price target on PayPal (PYPL) following the company's "upbeat" investor day on Thursday, where management discussed monetization strategies for merchants and consumer facing segments, updated medium-term guidance and provided data on non-eBay (EBAY)-related partnerships. The analyst sees a "host" of growth/scale catalysts, including "explosive" transaction growth int he mobile payments space and the ability to monetize its P2P engine Venmo, and believes that over time, given its recent agreements with Visa (V) and MasterCard (MA), PayPal will be able to scale and expand margins.

05/18/18

05/18/18INITIATION

On The Fly: Top five analyst initiations

Catch up on today's top five analyst initiations with this list compiled by The Fly: 1. MasterCard (MA) initiated with a Neutral at UBS. 2. AMD (AMD) initiated with an Outperform at Cowen while Intel (INTC) was initiated with a Market Perform. 3. Synthetic Biologics (SYN) initiated with a Buy at H.C. Wainwright. 4. Amneal Pharmaceuticals (AMRX) initiated with a Neutral at JPMorgan. 5. Apollo Commercial (ARI) initiated with a Buy at Deutsche Bank. This list is just a portion of The Fly's analyst coverage. To see The Fly's full Street Research coverage, click here.

As previously reported, Atlantic Equities analyst Kunaal Malde upgraded PayPal (PYPL) to Overweight from Neutral, as he believes the company's differentiated checkout experience should enable the company to continue taking share. PayPal's recent analyst day highlighted the company's ability to innovate to maintain differentiation, added Malde, who raised his price target on the stock to $99 from $84. While he sees PayPal gaining share, Malde also sees the card networks remaining reliable ways to play long-term e-commerce volume growth and keeps Overweight ratings on networks Visa (V) and Mastercard (MA), as well as on payment processor Worldpay (WP).

VZVerizon

$50.25

-0.62 (-1.22%)

06/21/18

06/21/18UPGRADE

On The Fly: Top five analyst upgrades

Catch up on today's top five analyst upgrades with this list compiled by The Fly: 1. PayPal (PYPL) upgraded to Overweight from Neutral at Atlantic Equities with analyst Kunaal Malde saying he believes the company's differentiated checkout experience should enable the company to continue taking share. 2. Verizon (VZ) and Charter (CHTR) were upgraded to Buy from Neutral at Goldman Sachs. 3. Terex (TEX) upgraded to Buy from Hold at Jefferies with analyst Stephen Volkmann saying Terex has underperformed both the S&P 500 Index and machinery peers year-to-date despite improving backlog and visibility into 2019. 4. AMC Entertainment (AMC) upgraded to Buy from Hold at Benchmark with analyst Mike Hickey saying he believes the company's new movie subscription service will succeed in driving incremental attendance and EBITDA. 5. Becton Dickinson (BDX) upgraded to Overweight from Neutral at JPMorgan with analyst Robbie Marcus saying he sees a "clear path" for Becton to exceed expectations for the second half of 2018 and fiscal 2019 now that the Bard acquisition is two quarters in. This list is just a portion of The Fly's full analyst coverage. To see The Fly's full Street Research coverage, click here.

06/21/18

GSCO

06/21/18UPGRADETarget $56GSCOBuy

Verizon upgraded to Buy from Neutral at Goldman Sachs

Goldman Sachs analyst Brett Feldman upgraded Verizon Communications to Buy and raised his price target for the shares to $56 from $51.

06/21/18

GSCO

06/21/18UPGRADEGSCOBuy

Goldman upgrades both Charter and Verizon to Buy from Neutral

Goldman Sachs analyst Brett Feldman upgraded both Charter Communications (CHTR) and Verizon Communications (VZ) to Buy from Neutral. The analyst raised his price target for Charter to $361 from $315 and for Verizon to $56 from $51. The year-to-date underperformance of the shares reflect concerns about fundamental headwinds, merger uncertainty and rising interest rates, Feldman tells investors in a research note partially titled "The pipes are not broken." The analyst, however, continues to believe both Charter and Verizon are positioned as long-term leaders in broadband and 5G. Both operators can drive attractive long-term shareholder returns by sustaining their core focus on connectivity, Feldman contends. He views the valuation of both companies as attractive at current share levels.

06/21/18

RHCO

06/21/18NO CHANGETarget $58RHCOBuy

Verizon fundamentals have stabilized, says SunTrust

SunTrust analyst Greg Miller kept his Buy rating and $58 price target on Verizon after his meetings with its management, saying he is increasingly confident that there won't be another large-scale M&A event as has been the case with its many peers and that its fundamentals have also stabilized. Miller also maintains his view that the stock valuation offers downside protection while the benefits of U.S. tax reform remain "largely underappreciated".

Wedbush analyst James Hardiman notes that Harley-Davidson announced that it would be absorbing the entirety of the impact from recently enacted retaliatory tariffs on motorcycles imported from the U.S. into Europe. The analyst sees the decision as the right move, but a costly one. While the company's announcement is something Hardiman has anticipated for some time, Harley Davidson is far from out of the woods, with rising raw material costs and declining used bike prices adding to the significant margin headwinds represented by the announcement. He reiterates a Neutral rating and $42 price target on the shares.

06/26/18

RBCM

06/26/18NO CHANGETarget $40RBCMSector Perform

Harley-Davidson price target lowered to $40 from $48 at RBC Capital

RBC Capital analyst Joseph Spak lowered his price target on Harley-Davidson to $40 after the company disclosed that the retaliatory E.U. tariffs on U.S. motorcycle imports will raise the price per unit by about $2.2K. The analyst further cites the $30-45M headwind to FY18 results anticipated by the company from its decision to shift production away from the U.S., while also keeping his Sector Perform rating on Harley-Davidson.

06/25/18

STFL

06/25/18NO CHANGETarget $45STFLHold

Harley-Davidson estimates cut for EU tariffs at Stifel

Stifel analyst Drew Crum lowered his adjusted EPS estimates for Harley-Davidson to $3.76 for FY18 and to $3.69 for FY19 after the company disclosed its expected impacts due to the European Union having enacted tariffs on various U.S.-manufactured products, including Harley-Davidson motorcycles. The analyst, who keeps a Hold rating and $45 price target on Harley shares, is making no other changes to his assumptions at this point as he notes he is in the process of completing his Q2 dealer checks.

After Harley-Davidson recently said it may move production capacity out of the United States in response to EU tariffs, Morgan Stanley analyst Adam Jonas called engaging the President directly on issues of foreign trade a "rather risky PR strategy." Jonas believes the move to potentially reduce U.S. production capacity is mainly the result of declining U.S. demand, not EU taxes, and he also is not convinced the company will really move production to Thailand or India to make bikes for the EU market. He maintains an Overweight rating on Harley-Davidson and believes the stock will rebound sharply if the tension around EU tariffs proves to be part of a "more nuanced and controlled negotiating process."